As Television Gets More Digital, TV Advertising Needs To Follow Suit

Television advertising revenue was up 7.1% in January 2018, according to the latest stats from the Standard Media Index. While that’s certainly not bad news — the boost was largely fueled by advertisers spending more on live events like the NFL playoffs and the Golden Globes — the industry is far from out of the woods.

Although TV ad revenue increased, digital ad revenue rose by 16.8%, more than double TV’s uptick. More troubling still, social media ad spending was up 42%, with Facebook alone up 55%. That’s despite the platform’s numerous problems with fake news and changes to its News Feed and news, with average time spent on the platform actually dropping last quarter.What’s crazy is that this shouldn’t be happening, at least not to the degree it is. People may be watching much less linear television, but overall, the number of people watching actual ad-supported TV shows (as opposed to digital video) across all platforms is up.So what gives?

Show Us The Numbers

The beauty of digital advertising, at least to the brand managers who are ultimately tasked with determining ad budgets, is that it is all about numbers. They know exactly who saw the ad. Where they saw it. What they did next. Whether they eventually bought anything remotely like the product.On TV, they know the ad ran.Probably.That’s because TV isn’t delivered digitally (or wasn’t). But thanks to everything from smart TVs to mobile to connected devices (Roku, Amazon Fire TV et al), it’s a lot more digital than people realize. And therein lies the opportunity: take advantage of all that digitally viewed television to create the sort of data that the people who are buying the ads want.Now, is all that data that digital advertising relies on infallible? Far from it. So much data on advertising, especially around digital advertising, is nothing but smoke and mirrors. Three-second glances with the sound off counted as “views.” Half an ad loading on a page the user is trying desperately to navigate away from counts, too. Ads that annoyed, obfuscated and harassed are credited identically as those that charmed and convinced.To many advertisers, the only result that matters is that the ad was (at some level) seen. Everything else is just gravy. (Which is why so many advertising dollars are wasted, but that’s a subject for another column.)

TV Fights Back

Now that TV has reached a point where much of what’s being viewed is, at some level, digital, the industry is starting to fight back. As I discussed here last week, ACR (Automated Content Recognition) data from smart TVs is capable of providing second-by-second metrics as to which shows and ads viewers are watching.Pioneering companies are now taking that data and combining it with IP-based metrics to provide multitouch attribution — a complex view of the effect that TV advertising has on the purchase funnel. Their goal is to provide advertisers with the data they need to prove what they long could tell by observation: TV advertising drives sales. (The fact that much of TV advertising is “brand advertising” — e.g., designed to make viewers feel good about the brand in general versus selling a specific product — is something multitouch attribution algorithms have already taken into account.)With an announcement this week, one of those pioneering companies, iSpot, is planting the TV banner in yet another arena: the ability to target and track advertiser-defined audience segments across the entire television ecosystem.iSpot tracks viewing across eight million smart TV sets using ACR data provided by Vizio. That allows it to know, on a second by second basis, which shows all those viewers are watching and whether they’re watching on set-top-box-based linear TV, connected devices, VOD, DVR or even over the air.They are now going to start sharing that data with LiveRamp, Acxiom's data onboarding division, the result of a brand new partnership. (“Data onboarding” is the process by which offline data— e.g., a company’s list of customers — is matched to an online database.) Data onboarders traditionally make use of a number of websites where customers have entered email addresses and similar identifying markers. To do this, the data is anonymized (e.g., stripped of what’s euphemistically known as PII, for personally identifiable information) so that customers are listed by an anonymized identifier (e.g., “User 458B3”). Cookies will then track User 458B3 so that they can receive more relevant messaging from advertisers, and advertisers can then track the effectiveness of those ads.And while it may sound a little invasive and creepy, the digital advertising world has been doing this for years, which is why all those brand managers are giving all their money to Google and Facebook: They rely on the Duopoly to target and track the people who see the ads and inform them of the results.Now it’s TV’s turn to get in on that action.“One of our missions is to connect the TV and the digital world in a seamless manner,” iSpot CEO Sean Muller told me in a recent phone call. “Our partnership with LiveRamp means that a retailer can give us a list of their top customers. We can take that list, pull out the PII, and, using LiveRamp’s data, we can figure out which TV shows they’re watching, which of the client’s ads they’ve already seen and how they reacted to them. That helps the client in many ways: they know which shows to reach those customers on, they can track whether those customers are already seeing any of their ads and they can track how seeing those particular ads affected sales. They can even do a form of A/B testing, showing different creative to their customers to see which campaign is more effective. And,” he added, “they can do that all in real time—no waiting weeks to see the results.”

The Right Data

What’s significant about the LiveRamp/iSpot partnership is not the ability to target—LiveRamp has been helping brands target customers on digital platforms for years, with a high degree of precision. It’s that brands can now do that with television in a way that’s never been possible before.While networks may offer solutions that show how certain audiences index against certain of their shows, that data is not nearly as deep or as accurate, and, most important, it’s only for that particular network. As independent third parties, iSpot and LiveRamp can help brands target their customers on every platform and network, regardless of timing (real-time or time-shifted) or delivery mechanism (set-top box or OTT). That’s a huge leap and it helps everyone in the industry by creating the sort of deep metrics that can prove the effectiveness of TV.

More To Come

There’s a lot more to come as TV goes digital. Programmatic buying, for instance, looks very different in a world where there are a finite number of options, all of relatively similar quality. (Versus the internet, with its seemingly infinite supply of websites, all of vastly differing quality.)There’s the evolution of systems that track how much of the messaging viewers retain, how much they remember: it’s long been the television industry’s contention that context matters, that ads seen on TV create a stronger emotional connection with viewers, who, in the correct circumstances, expect to see and even welcome the ads, all of which makes them more effective, particularly for branding.Finally, of course, there’s the most important metric of all: a universally accepted standard for measuring viewership across all the devices and platforms on which TV is currently being viewed. That’s less about accuracy, oddly enough, and more about getting all the players—networks, platforms, brands, MVPDs and ad agencies—to agree to a single currency that everyone can transact off of … and then holding digital video and its three-second “views” accountable to that same currency.

A Place For Everyone

Television advertising isn’t always better than digital or social advertising—there’s a place for all three (plus print and radio and now voice) in most marketing plans. But in order for those marketing plans to be effective, and for TV to prove its worth to marketers who rely on data to make decisions, it needs more wins like the LiveRamp/iSpot partnership. Originally published at Forbes.com on March 1, 2018